ITM Power: Executives Buy Into the Slump as Analyst Fair Value Estimates Slide

ITM Power shares drop 53% from peak, insiders keep buying. Berenberg holds 200p target but fair value slips; Morgan Stanley bullish. Execution risk looms.

ITM Power is sending mixed messages. The stock has been hammered in recent weeks, shedding nearly 11% in the past five sessions and over 16% in the last month, yet company insiders continue to accumulate shares through a regular purchase plan. At the same time, analysts at Berenberg and Morgan Stanley remain broadly bullish, even as their own valuation models have become more conservative.

The shares closed at €1.21 on Friday, down 1.79% on the day, and now trade more than 53% below the 52-week high of €2.58 hit on 29 May 2026. The water-logged performance stands in stark contrast to the year’s earlier surge: from a February trough of €0.648, the stock more than doubled by late May before surrendering most of those gains. Even so, the stock remains up 68.62% since the start of 2026 and 40.80% above its level a year ago.

Amid the sell-off, a routine insider transaction caught attention. On 15 July 2026, executives including CEO Dennis Schulz participated in the company’s "Buy-as-You-Earn" scheme, purchasing 134 partnership shares each and receiving a matching 134 shares from the company for a total of 268 ordinary shares per person. The purchase price was £1.1231 per share. While the volume is modest, such buying is often interpreted as a sign that management sees long-term value even as the stock hits the skids.

The bearish price action has pushed the 14-day relative strength index into oversold territory—to 36.3, according to one calculation, or 36.7 by another. Annualised 30-day volatility remains above 100%, underscoring the speculative nature of the water-storage play.

Berenberg, for its part, has held its price target steady at 200 pence, a level that implies significant upside from current levels. Morgan Stanley also recently upgraded its view. Yet beneath the surface optimism, the bank’s valuation model has delivered a less comforting message: the fair value of ITM Power shares has slipped from £1.31 to £1.20, now sitting just below the market price.

The revision stems from a combination of factors within the model. While revenue growth expectations remain high at 54.96% and the net margin assumption has been lifted slightly from 5.41% to 5.68%, the price-to-earnings multiple expected has fallen sharply from 186.82 to 162.17. A slight reduction in the discount rate, from 9.92% to 9.72%, was not enough to offset the multiple compression. The net effect is a lower intrinsic value, even as Berenberg’s headline target remains unchanged.

That discrepancy between a lofty price target and a declining fair value highlights the delicate balancing act analysts are performing. Both Berenberg and Morgan Stanley caution that execution remains the key risk: the path to sustainable profitability and the pace of project delivery are far from assured. Any slippage on milestones could unravel the whole valuation thesis.

The coming months will test whether ITM Power can convert its government-backed project pipeline and order book into reliable commercial deliveries. For now, the stock is caught between management’s willingness to buy the dip, analysts’ conviction that a bigger future awaits, and a market that remains deeply sceptical. The only certainty is the volatility—and the clash of signals shows no sign of resolution.